Market Report: Gestetner bid rumour enlivens quiet day

A LATE flurry of activity in the tightly-held shares in Gestetner, the photocopier supplier, sparked fresh speculation of a takeover bid.

The price rose 3p to 114p as a string of deals were struck in the last half-hour of trading.

Ricoh, the Japanese photocopier maker and 29 per cent shareholder, is seen as the most likely bidder, although Inchcape was once again rumoured to be casting an acquisitive eye over the group.

One dealer said Inchcape's rising share price over the past three years had put it in a strong position to mount an aggressive paper offer.

Shares in Inchcape, down 2p to 596p yesterday, have more than trebled in value since March 1990 while Gestetner's have fallen steadily from 230p over the same period.

Besides the bid talk, another trader said that Gestetner might have finally found a buyer for its Vivitar and Hamimex camera businesses, which it recently failed to sell for pounds 34m to Concord of the US.

Gestetner was one of few talking points yesterday, which saw just 423 million shares traded, with many dealers taking an extended holiday.

The FT-SE 100 index made a positive start to the session, but was dragged down late in the day by a weaker futures market and closed 0.5 points off at 2,812.6.

Lonrho was active, and the shares finished 4.5p better at a high for 1993 of 103p. A heavy 11 million were traded, and dealing in the options market was also lively, with more than 2,000 calls produced.

There was talk that more asset disposals would soon follow last week's deal to sell the Observer newspaper to the Guardian. There is a belief in some quarters that Roland 'Tiny' Rowland, joint chief executive, may be preparing to retire from the group by buying out some of the company's African mining interests.

Trafalgar House firmed 2p to 92p ahead of today's interim results, expected to show losses of more than pounds 90m after exceptional property write-downs of about pounds 120m.

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Analysts also expect changes in the boardroom. They predict Simon Keswick of the 25 per cent-shareholder Hongkong Land will become chairman, and John Ansdell, finance director, will depart.

BAT Industries was up 17p to 873p, ahead of first-quarter figures today. Sharelink, the execution-only retail stockbroker, said BAT had shot up from 25th to 10th place in its league table for the most popular shares among private investors.

A 7p rise to 164p in Hillsdown greeted news that Sir Harry Solomon, non-executive director and former chairman, had sold 1 million at 161p, cutting his holding to 4.4 million. Raymond Mackie, finance director, has bought 25,000 at 155p.

There were some big movements in second-liners. Owners Abroad slid 7p to 100p on adverse press comment about profit expectations.

Shares in Campari International were mauled on a profit warning, losing 58p at one stage before closing at 133p, down 45p on the day.

Conversely, Aerospace Engineering spurted 4.5p to 19p on the sale of Forward Industries to OMI International, unchanged at 24.5p.

Goodhead closed 1p off at 25p, having touched 22p on boardroom changes and a profits warning. John Madejski, non-executive chairman, is becoming executive chairman and chief executive in place of Colin Rosser, who will remain a director.

A rumoured downgrade by NatWest Securities clipped 6p off Wickes to 109p.

Somerset Trust was suspended at 178p, ahead of a possible reverse takeover of a manufacturing company with annual sales of pounds 20m. The deal, if it proceeds, will be funded by a placing and rights issue.

A weaker futures market late in the day unsettled leading share prices, which had made a firm start to the final leg of the three-week account. The FT-SE 100 index, up 9.8 points in morning dealings, closed 0.5 down at 2,812.6. Account ends 7 May, and settlement is on 17 May.